Saudi Arabia’s Al Tayyar Travel Group is betting on tourism as a key driver of the kingdom’s diversification plans.
Equinox Ventures, a joint venture between Equinox Group and Riyadh-listed Al Tayyar Travel Group, has signed a deal with the US-based mid-market hotel operator Choice Hotels International to open 25 properties accounting for 8,000 rooms in Saudi Arabia and the UAE by 2021. The Dubai-based Equinox Group is a subsidiary of Al Tayyar Travel Group.
The first two are expected to open this year in Saudi Arabia, while the first in Dubai is expected next year, Shuja Zaidi, the president of Equinox Group, said at the Arabian Travel Market in Dubai on Tuesday. The properties will be under Choice Hotels’ Clarion, Comfort and Quality brands.
Al Tayyar Group reported a net profit of 194 million Saudi riyals (Dh190m) during the first quarter, down from 286m riyals a year earlier. The decline in revenues was attributed to a “decrease in sales of the traditional travel industry and domestic tourism especially travel to the government sector and government sector related companies”, it said in a filing last week.
With the deal’s focus on the mid-market segment, the company expects to target Haj and Umrah pilgrims as potential clients, said Abdullah Aldawood, the chief executive and managing director of Al Tayyar Travel Group.
On Sunday, the kingdom launched a post-Umrah programme to allow pilgrims to visit tourism sites in the country by converting an Umrah visa into a tourist one.
The Saudi Vision 2030 has, among other sectors, identified tourism as a key to its diversification. While no policies have been disclosed, the Saudi government said it would identify plots of land to develop tourism projects and cultural venues besides improving pilgrim experiences.
International players are also bringing in new brands to the Saudi market.
Marriott International expects to expand its extended stay brands such as Residence Inn and Marriott Executive Apartments in the country.
“As the economy diversifies away from oil, that is an opportunity for us as there will be a greater growth in other sectors that will bring in more people [to the country],” according to Diane Mayer, a vice president and spokeswoman for the extended stay brands Residence Inn by Marriott and Marriott Executive Apartments at Marriott International.
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